PM Modi Declares Successful Production of India’s First Chip at a Semiconductor Factory in the Northeast

According to the Prime Minister, the first semiconductor chip designed and built in India could be produced soon by the plant in Assam in the Northeast. Officials highlighted that the region has moved to the forefront in energy and semiconductors at the Rising Northeast Investors Summit 2025. Last year, the Tata Group started building the semiconductor facility, investing Rs 27,000 crore to move India closer to making its own high-tech devices.

Context:

• Soon, the Northeast will see the first Indian-made semiconductor chip manufactured at the Tata Group’s plant. 

• Because of impressive infrastructure and trade growth in the region, investors are likely to be drawn to the Northeast and help make it an important gateway for India’s trade with ASEAN.

Key Details

Looking at Semiconductor Plant & Investment:

• The Tata Group broke ground on a Rs 27,000 crore semiconductor plant in Assam in August of last year.

• The plant will create the first Indian semiconductor chip.

• It creates new chances for advanced technology industries in the area.

Energy Sector Growth

• They are putting a lot of money into hydro and solar energy projects in the Northeast.

• Focus on producing solar modules, cells, storage systems and doing research to replace importing them.

Infrastructure Development:

• Over the past decade, the Northeast has seen over 11,000 kilometers of new highways and many more miles of rail lines.

• Industrial growth depends on the strong development of roads, power and logistics systems.

Growing Trade with ASEAN:

• Right now, trade between India and the ASEAN countries is valued at $1.25 billion and is expected to reach more than $200 billion shortly.

• Northeast is recognized as an important link between India and Southeast Asia.

Major new projects have been confirmed.

• Adani Group wants to pour another Rs 50,000 crore into development projects in the Northeast over the next 10 years.

• The group will invest twice as much, aiming to achieve Rs 75,000 crore of investments over five years.

• They demonstrate that companies are confident about the region’s future progress.

Current Status

• India’s semiconductor market stands at $45 billion in 2023 and is expected to grow by 13% annually, exceeding $100 billion in 2030.

• As of early 2024, China is the biggest market for 5G smartphones followed by India, a sign that many products in India are being purchased domestically.

Opportunities

• We have access to a large local market in China.

• Large numbers of people are now using electronics and digital devices and the trend includes 5G smartphones and IoT equipment the most.

Help from the Government:

• The Government announced the launch of the India Semiconductor Mission (ISM) with an investment of Rs 76,000 crore, to assist semiconductor and display production.

• Fab, display, compound semiconductor and related designs receive up to half of their cost as tax incentives under several schemes.

Infrastructure Development:

• Having semiconductor fabs, assembly, testing, marking and packaging facilities is creating a powerful ecosystem.

Strategic Partnerships:

• Working together with US and Japanese companies in the semiconductor field helps India advance its technology and train up staff.

Government Initiatives

• The India Semiconductor Mission (ISM) offers financial as well as policy assistance to develop semiconductor and display ecosystems.

• For the Modified Scheme for Semiconductor Fabs and Display Fabs, capital investment receives 50% financial assistance.

• Up to 50% incentives can be received for design expenses through the Semicon India Future Design Linked Incentive.*

• SPECS supports the domestic growth of electronic parts and increases local industrial value.

• For producing electronics on a big scale and manufacturing IT hardware, there are Production Linked Incentive (PLI) Schemes.

• Modified Electronics Manufacturing Clusters (EMC 2.0): Boosts the quality and speed of infrastructure and the supply chain.

Why Semiconductor Is Important to Global Strategy 

• It leads to producing high-paid jobs, further investments in the boom’s fields and growth in electronics production.

• Thanks to Technological Sovereignty, India does not have to highly depend on other countries for its electronic needs and remains secure.

• Configuration: Photonics and semiconductor companies find India to be an important global player.

• Encourages discoveries in science and technology useful for emerging industries such as AI, quantum computing and Industry 4.0.

Conclusion:

The opening of the semiconductor plant in Assam represents India’s goals for technological independence and turning the Northeast into an economic powerhouse. Alongside big infrastructure development and higher investments from leading corporations, the region will help power India’s expansion, creativity and strong trade links with Southeast Asian nations in the upcoming decade.

UPSC Prelims Practice Question

Q.1 Which Indian state houses the Tata Group’s semiconductor plant, expected to produce the country’s first indigenous semiconductor chip?

A) Sikkim

B) Assam

C) Meghalaya

D) Tripura